Aviva PLC

Good morning and thank you for standing by. Welcome to Aviva's Q3 2024 Trading Update Analyst Call. If you wish to ask a question, please press star 1 on your telephone keypad. You will hear a tone to confirm that you are in the queue. If you wish to withdraw your question, you may do so by pressing star 2 to cancel. I must advise you that this conference is being recorded. I would now like to hand the conference over to Aviva's Group CEO, Amanda Blanc.

OK, thank you. Good morning everyone and welcome to Aviva's third quarter update. As usual, I'll give a brief overview and then hand over to Charlotte, who will take it before we open for Q&A. It's been yet another strong quarter of performance for Aviva. Today's numbers show that our strategy is working, driving growth right across the business, particularly in capital light areas. In general insurance, we've delivered double digit growth across the UK, Canada and Ireland. And in UK Motor, we've delivered an impressive 13% growth in policies in force year to date. There's also been impressive double digit growth in wealth net flows and protection and health sales. And in retirement, we have had an excellent nine months, increasing our volumes at good margins. These excellent results are driven by our customer focus strategy, which we showcased at our recent customer in focus session. Clearly in Canada, we've had elevated claims from cats this quarter as seen across the sector. I couldn't be prouder of the team and how they've responded to our customers through these very difficult times. And of course our diversified model means that we have been there for our customers when they need us and still achieved strong results overall. We're also moving at pace on recent M&A integrations with AIG, Probitas and Optium all progressing in line with plans. So we are delivering on our promises and we have real growth momentum and confidence for the future. All of this is possible because we have the right strategy, a disciplined approach to capital allocation and a strong grip on performance management. And of course we have an outstanding team who are committed to delivering for our customers and our shareholders. With that, I'll hand over to Charlotte to take you through the numbers.

Thanks, Amanda, and good morning, everyone. It's good to speak to you today about the continued growth across our business and another quarter of strong delivery. I'll first cover the highlights from the businesses, starting with general insurance. We have achieved premium growth of 15% across UK, Ireland, and Canada. an undiscounted core of 96.8% was only half a point higher than the prior period. This was a good result given the impact of the catastrophe events in Canada, which I'll cover in more depth shortly. Importantly, we have seen improvement in the underlying core again this quarter, a trend we expect to continue in Q4 as pricing actions continue to earn through. For the UK general insurance business, our performance was very strong again, Premiums were up 18%. In personal lines, premiums were up 26%, once again due to both pricing actions and new business growth, primarily in Aviva Zero and on PCW. Motor policy count has grown 13% this year, leveraging our capabilities and the strength of our brand. As the team was quick to spot and take action on inflation, this has allowed Aviva to grow our market share at attractive return calls. Commercial lines premiums grew 11%, driven by strong retention in mid-market and growth in SME and global corporate specialty, or GCS. GCS also included the addition of Probitas for the first time. Through Probitas, we now have access to a global market with a dual platform more than doubling our distribution opportunity. Importantly, Probitas is already performing in lines with our plans for the business with a mid-80s core in Q3. The UK's undiscounted court was 95.2%, just less than a point lower than the prior period, supported by continued improvement in personal lines, partly offset by commercialised performance, which was impacted by large loss experience in the first half of the year. In Canada, premiums were up 11%. Personal lines premiums grew 13%, driven by growth in auto and property and pricing actions across the portfolio. In commercial lines, premiums grew 8%, driven by continued favourable pricing actions, strong retention, and new business growth in GCS. Undiscounted core was 100%, reflecting the cat events in Canada that have impacted Aviva and our peers this quarter. These included wildfires in Alberta, flooding in Ontario and Quebec, and hailstones in Calgary. Estimated insured loss means that 2024 is the largest lost year for severe weather in Canada on record, and our losses from these events are broadly in line with our market share in the affected provinces. The discrete Q3 core was 110%, with the impact of these events above our long-term average for weather, as you would expect. But despite the impact of these events this quarter, we expect Canada to have a positive underwriting result for the full year 2024, and the strength of the business is demonstrated through its underlying performance. Moving to IWR. In the insurance business, protection and health sales were up 22%, with the acquisition of AIG more than offsetting some market contraction in individual protection. Wealth flows were up of 7.7 billion pounds were up 21%, driven by strong performance in our advisor platform, where customers inflows have grown strongly, outstripping outflows, which have remained elevated across the industry. Our platform continues to outperform most of our peers with its value, functionality, and reliability, a key competitive advantage. Workplace net flows were £5.2 billion in the first nine months, and we have now won 358 schemes in 2024, which will contribute further growth in 2025 as these assets transition. Retirement volumes grew 67%, while VMB more than doubled, reflecting higher volumes and strong margins. We wrote £6.1 billion of BPA across 59 deals in the first nine months. And as of today, we have written 7.8 billion. We expect this will not materially change over the remaining weeks of the year. So I'm pleased to say we have met our ambition of 15 to 20 billion of BPA business across the period 22 to 24. Moving now to the balance sheet. Solvency to cover ratio of 195% reflects the completion of probitas, payment of the interim dividend and the impact of lower interest rates. while good underlying capital generation was able to absorb the impact of Canadian cats, as well as additional capital strain from the higher BPA volumes in the quarter. Solvency debt leverage and centre liquidity remain within appetite at 29.5% and 1.7 billion pounds respectively. So to summarise, Aviva continues to grow, is financially strong, and we have a firm grip on performance management. The consistent and positive momentum of another strong quarter gives us great confidence in our outlook. The clear benefits of our diversified businesses and our customer focused strategy underpin our confidence in meeting our group ambition. And we are committed to delivering for our shareholders, our customers and our people. And with that, I'll hand over to the operator to start the Q&A.